While it is true that home warranties can be purchased for any home, this doesn’t mean that every home warranty is interchangeable. In fact, there are two main categories of home warranties we want to compare: home buyer warranties vs. new construction home warranties. Read on to learn more about their similarities and how they differ:
What is a Home Buyer Warranty?
To best understand the differences between these two types of coverage, it’s important to define each category. A home buyer warranty is basically an agreement that protects the expensive systems of the home from everyday wear and tear, mechanical malfunctions, and accidental breakdowns after your purchase. It protects you as a new homeowner from having to come up with expensive replacements and repairs out-of-pocket for a new-to-you home. To benefit from your warranty, you can file a claim to replace or repair a covered item.
What Does a Home Buyer Warranty Cover?
Generally, most major systems and appliances are covered under a home buyer warranty. You can cover up to 120 items under these warranties. Some specific items you can expect to be covered include your home’s heating and cooling systems, washing machines, septic systems, swimming pool, stoves, dishwashers, refrigerators, etc. The coverage for these policies begins when you close on your home.
What is a New Construction Home Warranty?
This type of policy differs from a home buyers warranty in that it allows you to purchase coverage for new home construction. The coverage still protects your home systems and appliances. However, this type of policy protects you beginning a year after the closing date for between two and five years, based on your policy. This makes sense because in new construction your appliances and major systems will likely remain covered by the manufacturer for at least a year. Therefore, this coverage would pick up where that ends.
What Does New Construction Home Warranty Cover?
What is covered under your new construction home warranty coverage will vary based on your plans. Basic plans often include coverage for major systems like the electrical, plumbing, and heating/cooling systems as well as appliances like your dishwasher, refrigerator, oven, and more.
Special Benefits of a Home Builders Warranty
One notable benefit of purchasing a home builder warranty for new construction is the fact that it often covers a spring and fall tune-up for your home heating and cooling systems. This ensures your home’s heating and cooling systems are running optimally. A new construction home warranty also protects your investment, mainly your newly constructed home. It can help protect you against defective parts and systems, problems that often don’t become apparent until you have lived in the home a few years.
Both Are Worthwhile
As you can see from the breakdown of both types of warranties listed above, they both are valuable and worthwhile. If you are buying a home that has been lived in for years, then obviously, your best bet is a homebuyer’s warranty to protect yourself from buying a problem someone else has left behind. When it comes to new construction, your biggest risk is construction error or defects that can become problematic once you have resided in your home for some time. Therefore, choose the type of warranty that best fits your situation, either for new construction or existing homes, and protect yourself from experiencing a headache down the road. After all, many of these issues are either unknown or do not become apparent until you have lived in the home for a bit. So, protect yourself!
